Bitcoin gains after Tesla accepts cryptocurrency for car purchase

Bitcoin rose by five per cent on Wednesday after billionaire Elon Musk said a Tesla car could now be purchased using the world’s most popular cryptocurrency.

The Central Bank of Nigeria, which initially banned trading in cryptocurrency, has adopted a new approach to the block chain technology due to its improved global acceptance and after critical views from the finance experts were expressed against its action.

Musk said bitcoin payments made to Tesla would not be converted to fiat currency.

The option to pay in bitcoin would be made available to non-US customers later in 2021, he said.

Business Insider reported the “Technoking” as saying in a tweet early Wednesday the EV-maker had added bitcoin as a payment option.

The choice is currently available to customers in the US, but will be made available elsewhere later this year, Musk said.

“Tesla is using only internal & open source software & operates Bitcoin nodes directly,” he said, adding, “Bitcoin paid to Tesla will be retained as Bitcoin, not converted to fiat currency.”

Musk published his tweet soon after Twitter users noticed the updated bitcoin support for all models of Tesla’s cars across online US stores. “Elon,” “Tesla,” and “#Bitcoin,” quickly became trending hashtags on the social media platform.

The price of bitcoin rose 4.7 per  cent to $56,360 around 4.20am ET.

It is up 90 per cent year-to-date and more than 800 per cent in the last 12 months.

The bitcoin payment details on Tesla’s website were directed to a web wallet address on BTC.com, according to The Block.

The automaker disclosed last month it invested $1.5 billion in the digital asset and said it would soon begin accepting it as payment for its products. Tesla reportedly used crypto exchange Coinbase to make its purchase.

Tesla shares rose by two per cent in pre-market trading on Wednesday.

Timi Agama, head of Department, Registration, Exchanges, Market Infrastructure and Innovation Department at the Securities and Exchange Commission, described cryptocurrency market as air that could not be caged or regulated.

According to him, cryptocurrency cannot be ignored as it is a market of about two trillion dollars.

He said, “There is a lot of investment move into the cryptocurrency market and the tendency is that it will reduce the amount of investments in the stock market.

“Part of the desire of the SEC even in the future is to provide a regulatory framework that will take care of all these challenges that we have seen internationally and the entire world is grappling with in terms of cryptocurrency and digital assets.

“For us at SEC and capital market, it is something to look at; the world cannot be moving forward and we will be static.”